If the tax rate is 30 and the net debt of the firm


The free cash flow to the firm is reported as $300 million. The interest expense to the firm is $60 million. If the tax rate is 30% and the net debt of the firm increased by $45 million, what is the free cash flow to the equity holders of the firm?

a. $285 million.

b. $303 million.

c. $387 million.

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Financial Management: If the tax rate is 30 and the net debt of the firm
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